The PTEN (phosphatase and tensin homolog) tumor suppressor is a phosphatase that inhibits phosphoinositide 3-kinase-dependent signaling by metabolizing the phosphoinositide lipid phosphatidylinositol 3,4,5-trisphosphate (PtdInsP(3)) at the plasma membrane. PTEN can be mono-or polyubiquitinated, and this appears to control its nuclear localization and stability, respectively. Although PTEN phosphorylation at a cluster of C-terminal serine and threonine residues has been shown to stabilize the protein and inhibit polyubiquitination and plasma membrane localization, details of the regulation of ubiquitination are unclear. Here, we show that plasma membrane targeting of PTEN greatly enhances PTEN ubiquitination and that phosphorylation of PTEN in vitro does not affect subsequent ubiquitination. These data suggest that C-terminal phosphorylation indirectly regulates ubiquitination by controlling membrane localization. We also show that either mono-or polyubiquitination in vitro greatly reduces PTEN phosphatase activity. Finally, we show that hyperosmotic stress increases both PTEN ubiquitination and cellular PtdInsP(3) levels well before a reduction in PTEN protein levels is observed. Both PTEN ubiquitination and elevated PtdInsP(3) levels were reduced within 10 min after removal of the hyperosmotic stress. Our data indicate that ubiquitination may represent a regulated mechanism of direct reversible control over the PTEN enzyme.